The new service offering, when considered alongside Northwood’s unique business model of ‘Guaranteed Rent’ - a minimum 12 month contract that guarantees fixed monthly payments to the landlord – is designed to encourage landlords to view buy-to-let once again as an investment option, which, regardless of the state of the rental market, and even if the property is vacant or the tenant stops paying, guarantees landlords their rental income every month without fail.
The total value of mortgages taken out to fund buy-to-let purchases continues to grow, with recent Council for Mortgage Lenders statistics showing that the UK’s 1.4 million buy-to-let mortgages now represent an estimated 12.8% of the property sector, compared to just 7.5% in 2010.
Furthermore, with total rental income to UK landlords in the private sector predicted to rise to £70bn in the next five years, together with strong tenant demand and rising rents, the appeal of buy-to-lets as a viable investment opportunity looks set to remain.
Nick Cooper, Managing Director of Northwood said:
“It is well documented that the private rental sector is one of the only property sectors to have grown through the credit crunch, and that growth doesn’t seem to be abating. Property investors are currently reaping the rewards of rising rents – with the prospect of further rises – and unprecedentedly low mortgage rates. In contrast, the most common day-to-day risk to the landlord is having a vacant property or a tenant who stops paying. The most recent statistics from the National Landlord Association revealed that 49% of landlords have experienced rental arrears in the last 12 months with the average void period lasting for 69 days – more than two months rent.
Our guaranteed rent initiative effectively removes this risk and therefore gives us a unique point of difference from which to promote buy-to-let as an attractive investment opportunity for small investor landlords and first time landlords as it means they can rely on an income coming in.
Research from earlier this year showed that there has been a marked increase in the number of landlords: figures from UHY Hacker Young, the accountant, show that 1.9 million taxpayers earned an income from property last year, up from 1.5 million at the start of the financial crisis. All evidence suggests that buy-to-let is a growing market and as such we want to be in a position to provide our landlords with a full service offering that enables them to capitalise on current market conditions.”
Northwood’s buy-to-let mortgage finder is an on-line tool that enables landlords to research and compare a comprehensive range of products and quotes from across the mortgage market and submit an application. Unlike many mortgage brokers, the service is completely free-of-charge. The service will be available on-line as a link from each individual Northwood office’s homepage.
Northwood also has a buy-to-let mortgage support team who are available via a dedicated telephone helpline and on-line. They will also deal directly with the lender to ensure that the application is processed efficiently.
